The Superannuation Legislation Amendment Regulation 2013 (No 1) was registered on Mon 4.3.2013, to implement aspects of the Stronger Super reforms.
The amendments to the SIS Regulations and Corporations Regulations 2001 set out the MySuper notification requirements for transfers of accrued default amounts, prohibit self-insurance and restrict the types of insurances that can be offered within superannuation. The regulation also refines the minimum insurance requirements for default funds and MySuper members in reg 9A of the Superannuation Guarantee (Administration) Regulations 1993.
From 1 July 2013, trustees will be prohibited from providing insured benefits unless they are supported by an insurance policy from an insurer. However, funds that are self-insuring at 1 July 2013 will have a 3-year transitional period until 1 July 2016 to move from self-insurance to external insurance arrangements.
Importantly, a new operating standard prohibits trustees from providing “insured benefits” other than those consistent with the conditions of release in the SIS Regs. However, the prohibition will only apply to beneficiaries who join a fund from 1 July 2014 (instead of 1 July 2013 as originally proposed). That is, the prohibition does not apply to the continued provision of insured benefits to members who joined a fund before 1 July 2014 and were covered in respect of that insured benefit before 1 July 2014. The final regulation also excludes “anti-detriment payments” (ie tax savings amounts under s 295-485(1)(b) of the ITAA 1997) from the definition of “insured benefits” to ensure that anti-detriment death benefits can continue to be paid.
DATE OF EFFECT: The amendments generally commence from 1 July 2013, except for the restriction on the types of insurance (1 July 2014) and the refinements to the minimum insurance for default funds (1 January 2014).
[LTN 43, 5/3/13]